A commentary on insurance coverage issues in Hawaii and beyond

July 02, 2018

Question Certified to Connecticut Supreme Court on Meaning of Collapse

Connecticut courts have been swamped with cases seeking coverage for collapse caused by faulty cement. In a recent decision, the federal district court asked the Connecticut Supreme Court to determine what constitutes substantial impairment of structural integrity for applying the collapse provision of a policy. Karas v. Liberty Ins. Corp., 2018 US. Dist. LEXIS 71844 (D. Conn. April 30, 2018).

The homeowners' home had cement supplied by the J.J. Mottes Concrete Company, which included minerals that cracked and destabilized the concrete, leading to its premature deterioration. The homeowners discovered that their basement walls were cracking, crumbling and deteriorating in a manner typical of Mottes concrete. A claim was submitted to Liberty. The policy covered collapse of a building due to "hidden decay." Collapse did not include settling, cracking, shrinking, bulging or expansion. Liberty rejected the claim because it constituted deterioration.

In Beach v. Middlesex Mut. Assur. Co., 532 A. 2d 1297 (Conn. 1987), the Connecticut Supreme Court held that "collapse" in a homeowners' policy was "sufficiently ambiguous to include coverage for any substantial impairment of the structural integrity of a building." Here, the parties disputed whether the damage to the home constituted a "collapse" under Beach.

Both parties agreed that the district court should seek certification from the Connecticut Supreme Court. Appellate guidance with respect to the definition of "collapse" would be determinative of not only this case, but many others pending throughout the state. Further, there was no controlling appellate decision because Beach arguably provided insufficient guidance. No Connecticut appellate decision had squarely applied Beach and arrived at a definition of "substantial impairment of structural integrity." Finally, certification was warranted because the concrete collapse cases were of great importance to the state.

Therefore, the following question was certified to the Connecticut Supreme Court: What constitutes a "substantial impairment of structural integrity" for purposes of applying the "collapse" provision of this homeowners' insurance policy?

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Question Certified to Connecticut Supreme Court on Meaning of Collapse

Connecticut courts have been swamped with cases seeking coverage for collapse caused by faulty cement. In a recent decision, the federal district court asked the Connecticut Supreme Court to determine what constitutes substantial impairment of structural integrity for applying the collapse provision of a policy. Karas v. Liberty Ins. Corp., 2018 US. Dist. LEXIS 71844 (D. Conn. April 30, 2018).

The homeowners' home had cement supplied by the J.J. Mottes Concrete Company, which included minerals that cracked and destabilized the concrete, leading to its premature deterioration. The homeowners discovered that their basement walls were cracking, crumbling and deteriorating in a manner typical of Mottes concrete. A claim was submitted to Liberty. The policy covered collapse of a building due to "hidden decay." Collapse did not include settling, cracking, shrinking, bulging or expansion. Liberty rejected the claim because it constituted deterioration.

In Beach v. Middlesex Mut. Assur. Co., 532 A. 2d 1297 (Conn. 1987), the Connecticut Supreme Court held that "collapse" in a homeowners' policy was "sufficiently ambiguous to include coverage for any substantial impairment of the structural integrity of a building." Here, the parties disputed whether the damage to the home constituted a "collapse" under Beach.

Both parties agreed that the district court should seek certification from the Connecticut Supreme Court. Appellate guidance with respect to the definition of "collapse" would be determinative of not only this case, but many others pending throughout the state. Further, there was no controlling appellate decision because Beach arguably provided insufficient guidance. No Connecticut appellate decision had squarely applied Beach and arrived at a definition of "substantial impairment of structural integrity." Finally, certification was warranted because the concrete collapse cases were of great importance to the state.

Therefore, the following question was certified to the Connecticut Supreme Court: What constitutes a "substantial impairment of structural integrity" for purposes of applying the "collapse" provision of this homeowners' insurance policy?